Poor Market Conditions will See 180 Solar Manufacturers Fail by 2015

A recent report by GTM Research suggests that due to the oversupply of the solar industry at least 180 solar panel makers will go out of business or be bought out by 2015.

Shyam Mehta, one of the analysts who composed the report, said that they expected nearly 60 percent of existing solar suppliers to leave the market by 2014.

GTM estimates that on average supply will exceed demand in the solar industry by 35 gigawatts each year for the next three years, with the largest number of casualties coming from the high cost US, European, and Canadian markets.

GTM analysed more than 300 panel makers when compiling their report and identified Solarworld,a and Conergy of Germany, Isofoton, and Solaria Energia y Medio Ambiente of Spain as potential buyout targets.

Shyam wrote in the report that “the writing is on the wall. These companies will either take what they can get via acquisition or they will bow out.”

Manufacturing costs for solar panels in the US, Europe, and Japan is over 80 cents a watt, whereas Chinese manufacturers pay just 58-68 cents a watt, allowing them to turn a high profit and survive for much longer when demand is low.

Even so, 54 of the 180 firms expected to exit the market will be Chinese, and this number would have been much higher if it was not for China’s ambitious plan to raise solar power capacity by 40 percent to 21 gigawatts by 2015.

The issue with PV is that of intermittent and daylight only power production.

SHEC Energy Corp of Canada has developed a very low cost solar thermal power generation and energy storage technology that can produce power at grid parity 24 hours a day without the requirement of a backup fossil fuel or nuclear power plant.

A study done on the 6,000 wind turbine in Norway showed that the fossil fuel power plants had to be on hot standby, running at near capacity, to fill in the energy dips. The same goes with solar PV. This seemingly inexpensive technology was only 15% effective in providing power compared to its rated capacity making the cost power effectively 10 times higher than the perceived cost one would expect.

With SHEC Energy's technology, the perceived and real costs are the same since there is an economical energy storage component that is integral to their system.

SHEC Energy is also able to integrate its technology into existing fossil fuel and nuclear steam power plants, preserving the capital investment in those infrastructures.